Mises Daily Articles

End the DOE

Since 1979 the Department of Education (DOE) has steadily grown its empire. The fear that was once shared by Democrats and Republicans alike has become reality: the federal government has seized power from parents and local educators and now exerts unprecedented influence in our nation's classrooms. Its $14.5 billion budget in 1979 now pales in comparison to the almost $70 billion it spends annually — an increase that has not been accompanied by improved student outcomes. The addiction to federal largesse has hurt students everywhere, with mass standardization and college debt being the most obvious side effects.

Market-based reforms do not occur as a result of policy and regulations — they can only occur in the absence of bureaucracy. This article will evaluate the DOE's effectiveness in each of its four primary activities and make the case to end federal involvement in education.

Activity #1: The DOE establishes policies relating to federal financial aid for education, administers distribution of those funds, and monitors their use.

The DOE is responsible for executing federal education programs that are authorized by Congress. As part of this role, it distributes financial aid to recipients ranging from early childhood to postsecondary education programs. In creating the DOE, however, Congress explicitly prohibited it from interfering in specific realms of education, stating,

No provision of a program administered by the Secretary or by any other officer of the Department shall be construed to authorize the Secretary or any such officer to exercise any direction, supervision, or control over the curriculum, program of instruction, administration, or personnel of any educational institution, school, or school system. (Section 103[b], Public Law 96–88)

The DOE has maneuvered around these restrictions by using federal funds as a means of luring states into their so-called optional programs. A prime example of this is its Race to the Top (RTT) initiative of 2009. One of the four key pillars of RTT is to incent states to adopt standards and assessments that that the DOE deems conducive to education reform — exactly what it's prohibited from doing. The DOE boasts that this initiative provides strong financial incentive for states to take legal action that is "consistent with the goals of the Administration" and that the discretionary funding is "an incredible catalyst for reform across the country as states position themselves to better compete for funds." In other words, the more a state aligns itself with Obama's education agenda, the better its chances of receiving federal handouts.

Not every state took the bait for RTT. Texas Governor Rick Perry explained his refusal to participate by stating, "we would be foolish and irresponsible to place our children's future in the hands of unelected bureaucrats and special interest groups thousands of miles away in Washington, virtually eliminating parents' participation in their children's education." Still, tax-paying Texans are forced to subsidize prize money — funds they could use to educate their own children.

RTT is but one example of how the DOE uses largesse to seize unconstitutional federal control of education. No Child Left Behind requires all schools receiving federal funding to participate in statewide standardized tests, with those receiving Title I funding subjected to its Adequate Yearly Progress requirements. Naturally, these tests incentivize even greater standardization in an education system that already resembles a soulless assembly line. Similarly, the Early Learning Challenge competition (now part of RTT) seeks to "ensure that more children enter kindergarten ready, with the healthy cognitive, social, emotional, and physical skills and ability necessary for success." Astonishingly, the absurd notion of kindergarten readiness is rarely called into question by mainstream pundits, a testament to just how desensitized the country has become to federal meddling in education.

Simple questions must be asked. Is it really the federal government's responsibility to ensure that states administer standardized tests? And why are taxpayers spending millions of dollars so that bureaucrats can determine how to impart social skills on three-year-olds? It's no wonder parents no longer parent — the government, after all, now educates the "whole child" — a textbook example of how socialism rapes citizens of their basic accountabilities until nobody is responsible for anything, not even their own flesh and blood. Former education secretaries William Bennett and Lamar Alexander summarize the paternalistic nature of the DOE:

Most of what it does today is no legitimate affair of the federal government. The Education Department operates from the deeply erroneous belief that American parents, teachers, communities and states are too stupid to raise their own children, run their own schools and make their own decisions.

Clearly, the DOE's role in elementary and secondary education is characterized by unconstitutional intrusions that do nothing to help educators meet the needs of the individual child, but instead usurp power from parents and educators by means of coercion. Unfortunately, it is equally adept at wreaking havoc on higher education as well.

The relative freedom with which American colleges and universities operate has made our postsecondary system among the best in the world; however, government programs that distort the market for higher education represent a significant threat to both educational quality and the return on investment (ROI) realized by students. Perhaps the most blatant of these consequences stems from federal financial aid (FFA) programs, such as Stafford and PLUS loans.

Between 1986 and 2006, college enrollment increased by about 48 percent . Many of these students were unqualified for higher education and required some form of remedial work — perhaps indicative of the fact that the percent of high school graduates finishing two- and four-year degrees within eight years has decreased. The cost of pursuing a college education has also increased substantially, with tuition and fees more than doubling since 2000 (based on CPI data). By providing virtually unfettered access to cheap loans the government all but ensures both overconsumption and inflated costs. As Neal McCluskey explains,

Consider that $65 billion going directly to students and its effect on demand: A student will "purchase" education at a price he can afford. Extra education money enables him to a pay a higher tuition. In the aggregate, multiple billions in student aid artificially inflate demand — and average tuition — as students who might not have gone to college do, and others attend more expensive institutions than they otherwise would have.

But what about low-income students who rely on federal loans to afford higher education? Thomas Woods cleverly retorts this objection:

This, incidentally, is how the government defines affordable. As with housing, government programs artificially increase prices. What makes those inflated prices "affordable," in the government's version of things, is that you can get a government-subsidized loan to pay them. Letting prices fall in the first place, so people might be able to pay college tuition or buy a house without enslaving themselves to debt for the rest of their lives, is not even on the table. (Rollback, p. 136)

FFA harms many of the students it supposedly empowers. The FY 2008 national cohort default rate was 7.0 percent, an increase of 0.3 percent from the FY 2007 rate — yet the College Cost Reduction and Access Act cut interest rates on federally subsidized loans by 50 percent over a five-year schedule. Such a move only serves to encourage more artificial demand and will ultimately result in persistently high dropout and default rates.

The inevitable effects of overconsumption are underscored by the fact that while the income potential for a college dropout is virtually unchanged, she must now bear the dual burdens of servicing student debt and the emotional scars of failure. Oddly, the supposedly "compassionate" policies espoused by left-liberals rarely account for the human toll of market distortions. Credit-rating agency Moody's summarized the grim prospects for students burdened by debt:

Unless students limit their debt burdens, choose fields of study that are in demand, and successfully complete their degrees on time, they will find themselves in worse financial positions and unable to earn the projected income that justified taking out their loans in the first place.

According to the Bennett hypothesis, schools will continue to raise tuition as long as the government guarantees payment.1 It logically follows, therefore, that abolishing all forms of FFA would effect a drastic decrease in the average cost of a college education. This, in fact, would make college truly affordable and allow students to finance their education via private means such as part-time work, savings, and philanthropic support. Additionally, private lenders would have a strong financial incentive to lend funds to high-potential borrowers, regardless of socioeconomic status.

The federal role in higher education goes well beyond student aid. Between 1970 and 2006, federal spending on university-based research rose from $11.7 billion to an estimated $31.4 billion. According to the CATO Institute, much of this research is either unnecessary or would be conducted in the absence of federal largesse. Naturally, the process for divvying up handouts is highly politicized and ultimately leads to malinvestment.

Increases in institutional aid, however, are not accompanied by cost reductions for students. Instead, schools are using state and federal funds to grow their administrative empires. A recent Goldwater Institute paper highlights that the number of full-time administrators per 100 students at America's leading universities grew by 39 percent between 1993 and 2007 — during which time the number of employees engaged in teaching, research, or service only grew by 18 percent. This administrative bloat, they postulate, is largely symptomatic of the fact that consumers only bear a small fraction of administrative costs — while federal and state governments feed the unproductive glut that is buried in compliance reports.

It is also evident that federal handouts in higher education do little to impact the quality of education inside classrooms. Daniel Bennett of the Center for College Affordability and Productivity notes that from 1987 to 2007 the ratio of degrees awarded to the number of administrators fell, prompting him to state that "colleges are probably one of the least productive institutions that we have." Clearly, there are plenty of inefficiencies to eliminate, and continued federal support is akin to giving food stamps to millionaires — entirely unnecessary and wasteful.

The DOE's role of establishing policies and distributing aid has given the federal government de facto control of the entire system of American education. These forms of federal welfare only serve to distort the markets while giving bureaucratic "experts" unconstitutional control of both the content of education and how systems are operated. It is evident that taxpayers are not getting a good return on investment from the DOE's role as caretaker; all federal largesse should be returned to them.

Activity #2: The DOE identifies the major issues and problems in education and focuses national attention on them.

The DOE champions itself as a thought leader in education — it makes policy recommendations to the president and engages in extensive public-relations efforts. Put another way, the DOE nationalizes handpicked problems and propagandizes its agenda.

The DOE's Listening and Learning Tour of 2009 is a good example of its involvement in this realm of education. Secretary Duncan and his senior team visited educators in all 50 states, including remote Alaskan villages, an Indian reservation in Montana, community schools in Orlando, and inner-city schools in Detroit. While this tour clearly succeeded in earning style points for political correctness, one can only question how much actionable information was obtained from these incredibly expensive stop-and-chats.

Are educators and children better off after giving feedback for what they believe should deserve "national attention"? And what did the secretary and his lackeys learn that couldn't have been ascertained from a survey at a fraction of the cost? Of course, the underlying purpose of these events was to promote the DOE's agenda, which includes enticing states to implement college and career-ready standards and assessments — more of the same "one-size-fits-all" approach.

Somehow the Listening and Learning tour was a beacon of productivity in comparison to the DOE's Read to the Top! initiative, in which 15 cabinet members and other senior administration officials read to more than 1,200 children at 30-plus schools. It is difficult to imagine how the youngsters contained their excitement when a real-life bureaucrat dedicated their time (well, taxpayers' time) to reading Dr. Seuss. One can't help but wonder whether or not a cleaned-up and literate homeless man could have achieved the same effect. Not only would this have been much cheaper, it also would have provided a stimulus to the local economy (another favorite pastime of our beloved feds). At least one good thing came out of this initiative: every minute a bureaucrat spent reading was one less minute dedicated to creating new regulations and reporting requirements.

Most ailments in education are the result of mass standardization: treating every child as though her unique interests, abilities, and needs are no different from the 29 other children in the classroom. Until this fundamental illness is healed, all other remedies will prove ineffective. Focusing "national attention" on what the department declares as "key educational issues" actually works in favor of this primary cancer; the solution to mass standardization, after all, cannot be more centralization; it must be an unrelenting decentralization of power that focuses local attention on local education. After all, even kids within a remote Alaskan village have very dissimilar needs that cannot be arbitrarily lumped into one group — so how can generic and politicized federal policy possibly account for the infinitely different needs of millions of children across the country? Even if DOE bureaucrats were to listen to every child individually and read in every classroom, they still wouldn't comprehend the needs of children as parents and educators do.

The DOE's role of ensuring national attention on education is counterproductive and will only lead to a greater degree of standardization. The problems prevalent in education can be solved by freeing parents and educators to meet the demands of the individual child, not by making them subservient to the political whims of DC. While there might be merit in stating that education warrants everyone's attention, there isn't a need for a collective course of action, as local problems require local solutions.

Activity #3: The DOE collects data and oversees research on America's schools and disseminates this information to Congress, educators, and the general public.

The DOE's Institute of Education Services (IES) uses its $200 million budget to oversee research, collect data, and gather information on best practices in education. Each year its army of almost 200 employees and myriad contractors and grant recipients release hundreds of publications that cover an array of topics, all with the intent of improving outcomes in our nation's classrooms.

It must be acknowledged that IES, in fact, produces at least some degree of value for educators and policymakers — after all, even the most dysfunctional organization has the capacity to produce something of use when blessed with such vast resources. However, the DOE's role in this realm of education must be analyzed in the context of its economic return on investment. When viewed from this perspective, it is entirely clear that IES's ROI for taxpayers is, at best, underwhelming.

The DOE purports that its publications "meet the public's demand for information" — but how can it be certain? While each publication might succeed in meeting somebody's demand, there is no way to be certain that there is sufficient demand to warrant its investment of time and resources. Of course, the only way to know precisely whether or not IES's $200 million budget is being spent efficiently is via market prices; if these funds were rightfully returned to taxpayers, would the "public" willingly pay at least enough to cover the costs of producing an identical menu of information? It would be more accurate to state that DOE attempts to meet what it thinks is the public's demand for information — with the "public" largely composed of the politically connected and academic elite who drive their research agenda.

Are taxpayers really spending $200 million so the DOE can oversee research that recommends quizzes, biographical readings, and modeling love? Do 656-page reports with obscenely long titles really impact teacher performance? Clearly, the DOE's return on investment from efforts in collecting data and disseminating research does not justify its role in carrying out these functions. The demand for this information should be satisfied by universities and private institutions without federal handouts. Such a system is vastly more efficient and will produce research that actually impacts student achievement.

Interestingly, the initial impetus for government intervention in American education was largely based on the desire of states to assimilate immigrants by instituting systems of compulsory education. These inherently discriminatory policies sought to destroy the vestiges of foreign cultures and languages. Years later, the DOE now ostensibly seeks to promote the interests of minority groups. Specifically, it enforces five civil-rights statutes that apply to entities receiving DOE funding, including colleges and universities, elementary and secondary school systems, and museums.

As Andrew Coulson illustrates, the federal government has spent roughly $2 trillion since 1965 trying to raise overall achievement and narrow the gaps between white and minority students. However, these efforts have been futile, as test scores have remained relatively stagnate. In areas where the achievement gaps have closed, it has had little correlation with shifts in federal policy. Speaking of the black-white reading gap, Coulson explains,

The gap was essentially unchanged for the first 15 years after the passage of the ESEA and Head Start. Then, in the absence of any dramatic change in federal policy or spending, the gap suddenly narrowed between 1980 and 1988. Since 1988, the gap has actually widened slightly, despite a dramatic rise in federal spending over that period. The patterns for both math and reading for both black and Hispanic students tell similar stories.

The DOE has clearly failed to make a demonstrable impact on closing the achievement gap between whites and minorities. If anything, its meddling has helped ensure that students from low-income families have access to equally horrendous schools. Andrew Young and Walter Block provide a simple idea that would undoubtedly help students of all backgrounds:

The solution to this massive waste of resources being thrown at goals which do not materialize, is the market.

Students' success requires a course of education that treats them as individuals. No two students are the same, regardless of characteristics such as race, sex, or ethnicity. Federal education policy treats heterogeneous students homogeneously — a grave injustice to every child.

Conclusion

Since its founding, the DOE has engaged in unconstitutional federal meddling in education that has produced little for taxpayers. We should take a top-down approach to revolutionizing our systems of education, beginning with abolishing the DOE and ending federal involvement altogether. Market-based reforms and innovation will never come from the Lyndon Baines Johnson Education Building in DC. It's time to end the DOE.

1. In 1987, then-Secretary of Education William J. Bennett said, "[I]ncreases in financial aid in recent years have enabled colleges and universities blithely to raise tuitions, confident that Federal loan subsidies would help cushion the increase." The "Bennett hypothesis" is a generalization of this claim.

Search Mises Daily

Search this site

What Is the Mises Daily

The Mises Daily articles are short and relevant and written from the perspective of an unfettered free market and Austrian economics. Written for a broad audience of laymen and students, the Mises Daily features a wide variety of topics including everything from the history of the state, to international trade, to drug prohibition, and business cycles.

Articles are published under the Creative Commons Attribution-NonCommerical-NoDerivs (CC BY-NC-ND) unless otherwise stated in the article.